CASE NO.: Appeal (civil) 13417 of 1996 PETITIONER: TULIP PARK CO-OPERATIVE HOUSING SOCIETY LTD. RESPONDENT: SAI OVERSEAS IMPORT AND EXPORT DATE OF JUDGMENT: 14/09/1999 BENCH: S. SAGHIR AHMAD & D.P. WADHWA JUDGMENT:
JUDGMENT
1999 Supp.(2) SCR 377
The Judgment of the Court was delivered by
D.P. WADHWA, J. Appellant was complainant before the National Consumer
Disputes Redressal Commission (for short `National Commission’).
Proceedings were initiated under the Consumer Protection Act, 1986, under
which National Commission has been constituted to entertain complaints
where value of the goods or services and compensation, if any, claimed
exceeds Rs. 20 lacs. National Commission is also an Appellate Authority. It
hears the appeals from orders of the State Commission.
The complainant, a co-operative housing society, had complained short-fall
in services rendered by the respondent, a builder and developer, which had
agreed to construct and sell 64 flats to the complainant in a building
called Tulip Park. The complainant is not happy with the order dated June
21, 1996 of the National Commission in one aspect and it is that while
under the agreement dated May 10, 1990 respondent had agreed to construct
the flats having total saleable area measuring 34, 361 sq. ft. at the rate
of Rs. 630 per sq. ft. but the saleable area actually measured comes to
29,788. 34 sq. ft. There being thus short fall of 4,572.66 sq. ft. in the
constructed area. Since complainant had paid the price for the area of 34,
361 sq. ft. and it got only 29,788.34 sq. ft. it claimed refund from the
respondent of an amount of Rs. 28,80,776 (4, 572.66 sq. ft. x Rs. 630 per
sq. ft.). The National Commission did not agree with the complainant. In
this appeal by the complainant we are called upon to decide on, what the
appellant says, if there is any deficiency in services provided by the
respondent, the builder. Under clause (g) of Section 2 of the Act
“deficiency” means “any fault, imperfection, shortcoming or inadequacy in
the quality, nature and manner of performance which is required to be
maintained by or under any law for the time being in force or has been
undertaken to be performed by a person in pursuance of a contract or
otherwise in relation to any service”. A complaint lies if there is
deficiency in service of housing construction. “Service” under clause (o)
of Section 2 means service of housing construction as well. Grievance of
the complainant is that the respondent failed to give 34,361 sq.ft. of area
in the building Tulip Park in accordance with the terms of the contract and
that less area was given. When this fact was brought to the notice of the
respondent it took the stand for the first time that there was a mistake
and it had forgotten to include the stilt area in the agreement and claimed
that the complainant had to pay for the stilt area. There is no ground
floor as the building is constructed on stilts. Price of land is included
in the cost of construction calculated at the rate of Rs. 630 per sq. ft.
Actual total saleable area given was 29,788.34 sq. ft. and thus there was
the shortfall of the actual area. The respondent was liable to return the
amount for the shortfalls of this area aggregating to Rs. 28,80, 776.
We may at this stage refer to some of the terms of the agreement alleged
breach of which led the complainant to approach the National Commission.
The agreement recites as to how the respondent, as developer, became
entitled to sell the land and the building constructed thereon. Respondent
was to construct the building as per sanctioned plan granted by the Bombay
Municipal Corporation. As per the sanctioned plan respondent was required
to construct 64 flats in two wings `A’ and `B Wing `A’ has seven floors
with four flats on each floor totalling 28 flats. Wing `B’ has six floors
with six flats on each floor totalling 36 flats. With the agreement a plan
was annexed showing the flats on each floor of both the wings giving sq.
ft. area of the flat. The plan, however, does not show the area of the
common places. Agreement specifically records the declaration of the
builder that the building is sanctioned for development and construction as
per the sanctioned plan granted by the Bombay Municipal Corporation. Orders
of the Bombay Municipal Corporation and the sanctioned plan were part of
the agreement. Members of the complainant are the employees of the Air
India and they formed themselves into a cooperative society called Tulip
Park Co-operative Society Ltd. They entered into agreement with the builder
on “package deal” basis to purchase the proposed building under
construction and the land described thereunder at the rate of Rs. 630 per
sq. ft. saleable area. Two clauses of the agreement which are relevant for
our purpose are as under :
“1. The Developer shall sell and the Purchaser herein as Chief Promoter
representing himself, and the enrolled members of the proposed Co-operative
Housing Society to be formed and registered under the Maharashtra Co-
operative Societies Act have agreed to purchase on what is commonly termed
“Package Deal” basis, the said proposed Building to be constructed and
comprising of 64 residential flats totally permitted for construction to
the extent of 34,361 sq. ft, of the saleable area inclusive of the balcony,
lift, landings lobby and staircase area on the portion of land admeasuring
1820 sq. mts., hearing C.T.S. No. 263, SrNo.7-A, Hissa 13, being, lying and
situated at village Marol, within the registration district of Bombay
Suburban of Greater Bombay, more particularly described hereunder in the
Second Schedule and prominently indicated on the Plan annexed hereto as
Annexure “1-A” together with the amenities and specification as more
particularly set out in the List of Amenities annexed hereto as Annexure
“II” at the consideration (which includes the value of the Land) that is
Rs. 630 per sq. ft. saleable area of the building and on the terms and
conditions as hereafter set out. It is agreed there will be no dispute on
the saleable area by the purchasers on any grounds and on any reasons.
2. That the total consideration (including the value of the Land and
amenities to be provided by the Developer) at the agreed deal rate of
Rs.630 per sq ft. of the proposed Building being constructed and consisting
of the 64 residential flats and to the extent of 34361 sq. ft saleable area
(inclusive of the balcony, lifts, landing, lobby and the staircase areas)
is agreed to be a sum of Rs. 2,16,47,430 (Rupees Two Crore Sixteen Lacs
Forty Seven Thousand Four hundred and Thirty Only).”
It is not disputed that the building was constructed as per the sanctioned
plan and each flat has the area as given in the plan annexed to the
agreement. It is the manner of calculation of the saleable area.
Complainant was put to notice of the area to be constructed in the building
from the plan annexed with the agreement as well as with the sanctioned
plan. Two things are apparent from the terms of the agreement: (1) Proposed
building was to have 64 residential flats totally permitted for
construction to the extent of 34,361 sq ft. of the saleable area (emphasis
supplied) and (2) there will be no dispute on the saleable area by the
purchaser on any ground and on any reason. We are not going into the
question if the area under the stilts was to be paid separately as claimed
by the respondent or not as that has been negatived by the National
Commission. We repeatedly put it to the learned counsel for the complainant
as to how and where the area of 4572.66 sq. ft. could have been built in
the building, shortfall, which is alleged. There was no answer to that and
there could not be any as the building was constructed as per the
sanctioned plan. Complainant has brought on record a certificate by its
architect giving the saleable area as 29,788,34 sq. ft. There is also an
affidavit in support of the report of the architect but what we find is
that the report of the architect is bereft of particulars. The report did
not find favour with the National Commission and we think rightly.
Considering the fact that the building was constructed as per the
sanctioned plan and each flat has the area as given in the agreement and
that complainant had agreed not to raise any dispute regarding saleable
area, particularly when permitted area of construction was to the extent of
34,361 sq. ft., we do not think there is any deficiency in service in
“housing construction” provided by the respondent. We uphold the orders of
the National Commission in rejecting that prayer of the complainant wherein
it had claimed that respondent be directed to refund Rs. 28,80,776 towards
the shortfall of the saleable area.
The appeal is dismissed. We, however, leave the parties to bear their own
costs.